At a White House press conference, Attorney General Eric Holder paints a grim picture of the state of cyberdefense, commenting, "There are only two categories of companies affected by trade-secret theft: those that know they've been compromised and those that don't know it yet. A hacker in China can acquire source code from a software company in Virginia without leaving his or her desk."

Many top companies, including General Motors Comp. (GM), E. I. DuPont De Nemours and Comp. (DD), Google Inc. (GOOG), and American Superconductor, Corp. (AMSC), have seen trade secrets stolen by hackers in China. At the press conference John Powell, general counsel for American Superconductor, shared a particularly troubling tale of how a big Chinese wind company -- formerly the largest client of his firm -- recruited a former employee and used their knowledge to remotely steal trade secrets. He comments, "It's a real threat and it's a really costly threat."

The document is ambiguous on how the U.S. will respond, but it makes it clear that Washington D.C. is well aware of the attacks from China on top U.S. corporations. Currently, the ability to mount a strong counteroffensive is stifled by the relative "greenness" of America's cyber-fighting force. This force is composed mostly of straight-shooting college IT types, many of whom have never hacked into a system they weren't allowed to.

Over the last year, the National Security Agency (NSA) has been showing up at top hacker conventions trying to convince more talented hackers to join its ranks -- but such efforts remain in their infancy and are being heavily stifled by animosity from the hacker community over punitive computer crimes law enforcement.

Security firm Akama Technologies, Inc. (AKAM) estimates that in 2012 33 percent of attack traffic originated from China. By contrast, the U.S. -- in second place -- only claimed 13 percent of global attack contract. Chinese government officials claim that hacking is illegal in China and that its own companies are also victimized by their domestic hackers. However, many of the attacks appear to be geared towards suppressing dissidents or attacking U.S. media entities that expose secrets of Chinese politicians.

Chinese hackers are responsible for a third of the world's cyberattacks. [Image Source: Kealtu]

The result is that the cyberwar between the U.S. and China is playing out as a classic bully-victim situation. China denies everything while constantly abusing both U.S. government agencies and private companies. And experts believe the U.S. is doing far precious little to fight back.

Last week, President Obama signed a cybersecurity executive order calling for voluntary corporate information sharing on security risks. Congress is in the process of establishing a more rigid framework for the sharing.

James Lewis, a former top State Department official who is now a cybersecurity specialist at the Center for Strategic and International Studies, praised the Obama administration's actions in an interview with The Wall Street Journal, stating, "This is what you have to do to get the Chinese to behave differently. You've got to keep pushing on them; you've got to keep grinding."

Trade pacts like the Trans-Pacific Partnership may provide a forum to push for stricter intellectual property protections. And Mr. Lewis suggests that the U.S. could put pressure on China by denying Chinese companies access to American banks, or by denying Chinese researchers visas, if attacks continue.

Seems like America always need a target country to distract its people from the local problems, like debt crisis, gu.n control, etc...

Cold War with Russia, Weapon of Mass Destruction at Iraq, War on Terror in Afghanistan & Middle East, and now Cycle Warfare with China. Weather they are being done for the right reason or not, this country will never find peace if its government keep functioning this way.

It is like the part of the matrix where they said the first version of the matrix was a utopian world but people rejected it.

The cold hard truth is people are hard wired to need a foe to slay and in the absence of one they turn on each other instead. Observe the people around you for a while and see how frequently they categorize people as either us or them based on all kinds of things large and small. We do it with a consistency that is alarmingly robotic and its fascinating to observe at times.

This is human nature; its a basic need of human to be superstitious as well humans can’t exist without some sort of mythos if its not religion its 911 truthers, aliens any number of conspiracy theories even atheism in itself fills that void. People’s lives are too easy the base rot in our society comes from people being bored because of that easy life so they fill it with nastiness towards others.

We are just guessing along with the government here.Does the US government has solid proof that Chinese government launched the cyber attack?How about proof on the Weapon of Mass Destruction?Or proof that War on Terror can reduced the world-wide terrorist attacks?Instead of raising taxes and wasting money on all these "conjecture," I would feel much better if they focus on the debt crisis, gun control and all kind of local problems. Fix our own problems before nose around others'.

I can tell you that the servers I manage for a pharmaceutical company came under attack from IPs located in China immediately following a trip one of our execs made to Shanghai to discuss licensing and approval for a cancer drug. We get attempts every day, but they come from all over. After his trip, actually DURING his trip, attempts skyrocketed with more than 90% of the attempts coming from China. It was not a high profile trip, by any means. No PR or anything. It is not proof that a particular entity did it, but somebody in China did. Coincidence? I very much doubt it.

Maybe it's very simple, and people - like other animals - are usually looking to get ahead at someone/something else's expense. So is it surprising that China would be doing it? Not really. Is it surprising that we would be doing it? Not really. What's more surprising is not standing up for yourself and trying to protect your position.

quote: is people are hard wired to need a foe to slay and in the absence of one they turn on each other instead. Observe the people around you for a while and see how frequently they categorize people as either us or them based on all kinds of things large and small.

It's our animal instincts to dominate, to defeat others.

In my opinion, it's simply the uncontrolled breeding of the weaker (all survive vs. high intelligent), less intelligent members of society that make the majority of society to have this mental condition.

With that said, aggressive governments (US) have always exploited the fact that the majority cannot see through the charades of good vs. bad, us vs. them, Left vs. Right and play along with the corrupt system that continues to move farther to the right than it has ever been in the last century.

The actual issue in the majority is lack of pattern recognition. That is in effect what allows people to be controlled and/or manipulated.

Governments have always have used such methods for legitimate uses like national security or to buy time so that prior plans for the greater good of the country have time to take effect. The abuse of the technique is what can be used to mask corruption and other nefarious uses.

"If you look at the last five years, if you look at what major innovations have occurred in computing technology, every single one of them came from AMD. Not a single innovation came from Intel." -- AMD CEO Hector Ruiz in 2007